Increasing Supplier Penetration Through Payment Modality Diversity

How can hospitals grow their ePayables program? The key to a successful program is listening to the needs of your suppliers, and offering a variety of electronic payment methods to meet those individual needs.

If a supplier has liquidity issues, they may be willing to accept a discount for early payment. In such a case, having access to supply chain financing and dynamic discounting opens up the possibility of increasing supplier enrollment, while generating some incremental rebate revenue—without affecting working capital. Other suppliers may be looking to seamlessly integrate their receivables into their AR system. If so, they may be willing to pay a transaction fee for embedded invoice data in ACH payments.

For a successful ePayables program, I recommend being able to offer suppliers:

ACH: with embedded CTX or EDI remittance information

Early payment: supply chain financing and dynamic discounting

Purchase-Cards: allowing staff limited purchasing power without having to submit check requests

A payment services provider: to mange all payments and accommodate the diverse receivables protocols of suppliers.

By forcing suppliers to accept only one or two payment methods, hospitals are limiting themselves to stagnant, underperforming ePayables programs that barely put a dent into their reliance on paper checks. By giving suppliers payment options to choose from, hospitals can dramatically increase the success of their ePayables program.